CERTYNEX IFRS ACADEMY

Nova SA holds a 10% interest in a joint operation, without having joint control. The agreement gives it neither rights to the assets nor obligations for the liabilities of the joint operation (case facts). How does Nova account for its interest?

Like a joint operator, line by line, because every party to a joint operation applies its rules whatever the exact nature of its rights.

Using the equity method under IAS 28, because the 10% interest reflects an influence that the standard treats like a joint venturer's.

It does not account for it until it obtains joint control, the interest staying off its balance sheet until that date.

In accordance with the IFRSs applicable to its interest, since the conditions for accounting asset by asset and liability by liability are not met.